As a demo racer you can still use custom skins. The problem for the demo folk is that the skin auto-download from LFSW doesn't work. The simple (and only, I think) solution is to upload your skin to an image hosting site such as
Imageshack.us and give the link to those people who you'd prefer to see your skin. The other people would then download your skin and put it in the appropriate folder, hence being able to view your skin.
Of course, it's all much easier once you are licensed and can exploit the LFSW skins feature to the fullest.